The first few months of opening your own doors for business can be an overwhelming proposition for most new startups. But with some investment of time and energy and the proper planning, there are ways to make sure your startup not only survives, but thrives during its first few months in business. Generally, these tips will help you avoid major pitfalls in getting your startup off the group, which will help to save you time and money in the long run.
Outsource as Much as Possible
It is understandable that when launching a new business, you will want to handle as much as possible yourself to cut down on costs and eliminate unknown risks. The drawback with this approach is that if you spend too much time and energy focusing on tasks that could easily be outsourced, you won’t be strategizing about ways to generate revenue. Be as inclusive as possible in the services you plan to outsource.
Line up Reliable Vendors
Rely on friends in the industry and verified recommendations to find vendors that can help you with outsourcing whatever you can. This should include accounting services, tax preparation, payroll, cleaning services, and a document shredding or storage company, among others. See if you can get real reviews from others who have used them to get the best quality work. Services like Vital Records Control might also do more than one task which makes your job easier.
Save Reserve Capital
The saying goes, prepare for the worst and hope for the best. Part of preparing for the worst is having a rainy day fund of hard, liquid cash in the event that you need to draw on the entirety of your credit line, or exhaust other resources as your business is just getting off the ground. This is often the difference between survival and being dead on arrival at the first major upset for new businesses.
Be Ready to Invest
A hard decision you will likely have to make is between drawing an extra income from the first year in business, or investing that money right back into the company in hopes that it grows bigger. From a tax liability perspective, it is advisable to consider investing as much as you can right back into the company, especially in the first three years, so that you reduce your taxable income and can benefit from even bigger profits down the line.
One of the most important things to keep in mind is that opening your own business is inherently stressful. You will likely encounter unanticipated challenges, so the more upfront planning you do, the less stressful those upsets will be.